CNBC has learned that Buy Buy Buy Baby stores are set to disappear after a last-ditch effort to save the chain and keep the business going collapsed.
Brand management company Go Global Retail, which owns children’s clothing company Janie and Jack, was eager to buy the darling bed bath behind Company CEO Jeff Strider told CNBC.
Lender Sixth Street Partners, Bed Bath & Beyond’s principal creditor, decided it could recoup more of its losses than Go Global was willing to offer by selling Buy Buy Baby’s intellectual property, auctioning the leases and moving forward with liquidation sales.
Dream on Me Industries, a little-known New Jersey-based retailer and former Buy Buy Baby supplier, won the chain’s brand and digital assets for $15.5 million after Bed Bath & Beyond failed to receive any higher bids.
Go Global believes there is a way to close as recently as Monday, but in the end, it was unable to agree a number with Sixth Street, Strreader said.
“We were fair in our offer. Sixth Street was not unreasonable, but there was a difference of opinion on the assessment,” he said. “We wish the IP bid winners success in their journey.”
All in all, Go Global’s bid had a higher dollar amount than the Dream on Me bid, but not by much because “there’s been significant erosion in value in the last six weeks,” according to a person close to the matter, who spoke on the condition of anonymity because they They are not authorized to discuss the matter publicly.
Another said that if the company’s bid was accepted, it would need to put up additional capital at the time of the sale to keep the stores running, and the way the bid was constructed did not affect the cost of Buy Buy Buy Baby’s intellectual property. someone close to the subject. While Sixth Street would have preferred to keep stores open, Bed Bath has not received a viable offer to allow it, the person said.
One person said that when the auction process first began, Go Global was willing to offer a “much higher” price. In May, the company was seeking an additional $50 million in capital to support its bid, CNBC previously reported.
However, after nearly three months of liquidated sales at Buy Buy Baby’s 120 store, there is very little left to bid besides IP, empty stores, leases and any remaining inventory, the source said.
Over the past several weeks, Bed Bath & Beyond had repeatedly pushed through the bankruptcy auction process and split Buy Buy Baby until it could secure higher bids and find a company that was willing to keep the stores running.
However, every time the auction was delayed, the source said, it was delayed by a week or so, which “certainly deterred potential bidders or investors.”
“Most people can’t move that fast,” the source added.
During a hearing in federal bankruptcy court in Newark, New Jersey, on Tuesday, Judge Vincent Papalia agreed to sell the intellectual property of Buy Buy Buy Baby to Dream on Me as one of the model’s employees, who appeared virtually via Zoom to attend the hearing, smoking a cigarette on the screen.
Attorneys for Bed Bath & Beyond said it was “unfortunate” that they could not secure a buyer because Papalia and other attorneys present at the hearing expressed disappointment that the chain could not be saved.
“I share the disappointment at the lack of ongoing bids,” Papalia said.
“It’s a shame, I think both parts are not moving forward and that’s disappointing. I had higher hopes going forward but sometimes, those hopes are not fulfilled.”